B.S.C.F.A. Proposes a Change in Payment Formula; A.S.R./B.S.I. Objects

One of the sticking points in the ongoing negotiation process has to do with the formula being used to calculate the prices farmers receive for the sugar cane they deliver to the mill. With the current formula, farmers receive sixty-five percent of net value after the mill sells its sugar and molasses. A.S.R./B.S.I. receives thirty-five percent of the net value. But, B.S.C.F.A. argues that this formula leaves farmers at a disadvantage. They are proposing a new formula which will see farmers receiving sixty percent from the gross revenues. The Chairman of B.S.C.F.A.’s Finance Committee, Javier Keme explained their rational behind this proposal.

Javier Keme

Javier Keme, Chairman, B.S.C.F.A. Finance Committee

“The amount that the farmer uses to get before 2015 was an average of fifty three, fifty four, fifty five percent of the total proceeds of the sale of sugar and molasses. In the last five years it has shrunk under the fifty percent. Last year it was forty nine percent and it has been in one year forty eight percent. So, we have been losing over the years, five to six percent of the total revenues. In the analysis we did, where this percentage is being accommodated. It is being accommodated in a series of deductions that is being done and this deduction is being done by the provider BSI, the mill itself. So, it goes back to the portion, remember we have a current model of sixty five thirty five of the net strip value. So, when we have the gross proceeds there is a series of deductions that is deducted for export and some other deductions that have been added these last year’s which part of the processing cost is. So, these have been increasing before 2017 on an average of fourteen, fifteen percent, to twenty five percent of the total revenues. So, that is the percentage that has been worrying the farmers, ebcasuer all the cost of production.”